7 You can buy the same products, at the same price, from the same supplier and still not beat your competition. Why? High finance costs Higher weighted Average Cost of Capital Poor distribution channels Lack of credit Inventory carrying costs Outstanding accounts receivables Poor cash flow Paper-based documentation

11 As much as 5% of the COGS can be attributed to financing! - per Bob Dyckman, Wells Fargo Bank, 2009

12 Risk management as per Mitsui & Co.: A lack of information relating to country risk or the creditworthiness of business partners can be an impediment to doing business. We undertake pre-assessment of business risks, devise methods for managing or mitigating risks we have identified, and based on this provide customers with tailored solutions. We have a particularly important role to play in determining and managing the creditworthiness of business partners, so that our customers can conduct their business with financial peace of mind.

24 A bank s WACC is generally much lower than any other company in a supply chain SCF opportunities are facilitated by banks and non-bank financial institutions The WACC for an SME can be substantially reduced within an SCF solution The cost of capital is affected by the volatility factor in an industry

32 61% of late payments are due to compliance or administrative problems such as incorrect invoices or receiving the invoice too late to process payment on established credit terms (Source: CRF - Credit Research Foundation)

38 Too costly and slow when compared to an Open Account Value > $100,00 can cost between $ $4000 per LC Rates vary between banks and countries SWIFTNet Trade Services Utility solutions are being adapted Automates an end-to-end solution for buyer and seller

41 Formed in 1999 TradeCard is bank agnostic and partners with 25+ financial institutions Utilizes cloud-based technology to support collaborative supply chain relationships Manages US $2B in transactions per month Assists its clients to attain more competitive financing rates when required Added Adidas to its client list in 2012 with its global suppliers Continued growth and largely unaffected by economic crisis of 2008 Enables buyers and sellers to manage procurement and financial transaction workflow with transparency, from order to account settlement, which optimizes cash flow and credit lines Branches in New York, San Francisco, Hong Kong, Taipei, Seoul, and Tokyo

43 Burton Snowboards: Key metrics: 56,000 SKUs supplied from Asia, Europe, and North American suppliers of boards, clothing and accessories ~500 FTEs in US, Europe, and Japan Products sold in 36 countries Key to low cost production based on WIP reporting from multiple suppliers WIP reports require high accuracy to avoid production delays, enabling an agile production schedule, or to reposition the sequencing of high-moving popular items By participating in a robust SCF solution most its suppliers have reduced their DSO

44 Golden Change: Key metrics: Described as medium-sized footwear company with 10,000 FTEs Annual sales $250M producing 12+M pairs/shoes exported to 100 countries High-season is April through October Customers include: Timberland, Dr Martens, Wal-Mart, LL Bean, Caterpillar, Wolverine World Wide, and Harley Davidson Savings of 75% by not using LC Sales people can view order status via laptop, any time, any where

52 Textile del Valle SA Key metrics: ~3000 FTEs Textile exporter from Peru to US and Europe Advised by a major global brand to move to an open account solution to reduce business process costs to its customers All orders, amendments, invoices, proof of delivery, and approval of payments are through a single multi-enterprise OA platform The OA allows Textile del Valle to request early payment options by clicking the box

54 General level of understanding of SCF solutions is low Willingness to be collaborative across the supply chain In-house operations, finance, and procurement need to be integrated as a strategy Loss of autonomy by individual managers Sharing of information seems counter intuitive Requires consistency in technology Requires training

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Meridian Partners Trade Financing About Us Meridian Partners provides you with the legal requirements of a registered office address in Hong Kong, a corporate secretary, telephone, fax and mailing services.

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